Net Neutrality: A Tax on the Internet

The Street ^ | May 5th | Mike Jude

[Halfmanhalfamazing]

A recent study I conducted for Stratecast estimated the effects that net neutrality regulations would have on consumers and the greater U.S. economy. Our model attempted to look at such regulations on broadband operators through the eyes of a CFO, who is charged, both from a legal and business perspective, to invest the funds of the company wisely. The model indicates that in the presence of net neutrality, investment in infrastructure would decrease, our economy would suffer with job losses, and the costs would ultimately be borne by the consumer.

The most negatively impactful of net neutrality options, strict non-discrimination, would tend to increase operators' costs by anywhere from $20 billion to $40 billion annually. If the operator were unwilling or unable to recover the costs from the subscriber base, then the model predicts that the operator would likely curtail network investment. This would not only lead to an eroding infrastructure, but also to an alarming erosion of jobs and overall economic growth.

Each Internet job spurs additional jobs within the economy. By our estimate, as many as 3.7 million jobs currently depend on the Internet, driving direct and indirect salaries and wages of up to $370 billion. Net neutrality regulations would have a drastic effect on jobs and the economy, and they would impact almost immediately. In 2011 alone, new regulations could impose a seven billion dollar a year overhead on the economy, with a commensurate impact of over 70,000 jobs.

[Halfmanhalfamazing]

Perhaps with the economic aspect tied to it, people will more understand why net neutrality is about silencing people online.

the-face-of-net-neutrality.jpg

faceofnetneutrality.jpg

[relictele]

There are many dimensions to the problem.

Unfortunately, many so-called conservatives and libertarians are so focused on the ‘crimes’ of ISPs that they actually believe FCC involvement would a) solve the problem and b) never be expanded or abused.

[Halfmanhalfamazing]

It’s an incredibly sad thing to watch. Here we have the government practically open about it’s wishes to regulate the internet(and we all know what that means) and those on our side act as if we haven’t been here before.

No no no, net neutrality isn’t really the fairness doctrine for the internet! *rolls eyes*

This is what a century’s worth of progressive indoctrination will get you. Freedom is slavery.

[InterceptPoint]

If you LIKE NET NEUTRALITY you must agree that the government should MANDATE that your ISP cannot decide MY BITS are better than YOUR BITS.

That sounds fair. But it isn't.

If you DON'T LIKE NET NEUTRALITY you must agree that your ISP gets to run his business any way he wants. If he doesn't like MY BITS as much as he likes YOUR BITS then, since he is the gate keeper of his own equipment, he can reject MY BITS and accept YOUR bits.

Sounds bad. But it isn't.

[RJS1950]

Taxing the internet and emails has been a democrat party wet dream for as long as the internet has been available to the public. It is also an opening to control the internet, like their buddies in China.

FUBO

[Jacquerie]

When this monster is unleashed, at least we'll have the comfort of knowing that not a single congress-critter voted it into law. Our rinos and rats can shrug their shoulders and say, “don't blame me.”

It will be done by unelected, untouchable, totalitarian bureaucrats who were unconstitutionally granted such powers by Congress long ago.

[relictele]

Amen.

Read any digg.com posting about net neutrality and you will see a fervor (pro-net neutrality) unmatched since Germany 1933.

[gogogodzilla]

If the operator were unwilling or unable to recover the costs from the subscriber base, then the model predicts that the operator would likely curtail network investment.

Where in all of the 'net neutrality' law would the recovery of operating costs be made impossible?

[BigSkyFreeper]

Proponents of net neutrality always cite the case of Comcast throttling back bandwidth for people who spend inordinate hours using P2P file sharing software. Comcast is a business, just like every other business, they have a business model and they have a Terms of Service agreement that every customer has to sign on and agree to before they serve up your internet to you. It’s real simple, if you don’t like Comcast, go with Verizon, if you don’t like Verizon, go with someone else.

[BigSkyFreeper]

If the operator were unwilling or unable to recover the costs from the subscriber base, then the model predicts that the operator would likely curtail network investment.

If that were the case, they should go out of business.  Hello?  That's free market capitalism.

[Halfmanhalfamazing]

—————— Where in all of the ‘net neutrality’ law would the recovery of operating costs be made impossible?-—————

I don’t think it’s in the law.

It’s in simple economics where that recovery would be made impossible.

There are tons of little website startups out there who don’t have much capital, customer base, or revenue. Yet.

That’s been the beauty of the internet this whole time. It is arguably america the way it used to be. Free from the government.(therefore, cheaper)

If you are too busy paying the greedy government, you aren’t growing your tiny little business.

[Halfmanhalfamazing]

———————If the operator were unwilling or unable to recover the costs from the subscriber base, then the model predicts that the operator would likely curtail network investment.

If that were the case, they should go out of business. Hello? That’s free market capitalism. -——————

No, that’s not free market capitalism.

This is government intrusion. Government increasing costs.

On the internet, we already have free market capitalism. What the left wants is to get in the way.(as usual)

[gogogodzilla]

I only pointed it out because it is a straw-man argument against net neutrality. By mentioning it in the article, the authors are implying that it will stop companies from recouping their operating costs... which it doesn't.

There are plenty of reasons to be against this without having to make stuff up. Doing so undermines their credibility.

[Halfmanhalfamazing]

I don’t know why any hidden implication was sought, what they said was very clear.

-—————By mentioning it in the article, the authors are implying that it will stop companies from recouping their operating costs... which it doesn’t.-—————

Not really. By mentioning it in the article the authors are stating that it will raise costs on the smallest of businesses who are trying to make their own way.

And it will. All regulations raise costs.

It’s hard enough for small businesses to recoup costs that naturally occur. There’s no need for artificial costs because the government wants more power.

[BigSkyFreeper]

Bailing a company out is government intrusion.

If an internet provider can't pay for their equipment they don't deserve to be in business, if they throttle back their speeds you should look elsewhere for your bits and bytes. The government wants to tell providers like Comcast how to run their business.

[Halfmanhalfamazing]

———————Bailing a company out is government intrusion.————————

Of course bailing out a company is government intrusion.

So too is artificially raising costs just because government wants more power.

-——————If an internet provider can’t pay for their equipment they don’t deserve to be in business———————

We aren’t just talking about an internet provider who can’t pay for their equipment. This would affect every business online, not just internet providers. And we aren’t talking about the natural costs of equipment and bills and labor.

This is an additional set of artificial costs imposed by government in the form of ‘regulation’ which is unnecessary. That’s not capitalism.